China wins if NAFTA dies

Writing in Americas Quarterly, Shannon O’Neil of the Council of Foreign Relations has come up with the punchiest statement on the costs of ditching NAFTA: “China wins if NAFTA dies.”

The often cited statistic that 40 cents of every Mexican export dollar north is created by U.S. workers is real, as thousands of companies have invested tens of billions in both nations, creating North American supply chains to make cars, computers, TVs, planes, washing machines, MRIs, defibrillators, and a whole host of other products. And even as some jobs in America’s rust belt have disappeared, many others have stayed or been created precisely because of these investments to the south. By spanning the border, factories make products they can sell globally – increasing the overall economic pie then shared between companies and workers in both countries.

As the United States pushes forward with its renegotiation, it shouldn’t lose the larger guiding philosophy behind NAFTA, namely the recognition that a stable and prosperous North America helps all three nations.